10 Deep Value Stocks to Buy Now

7. American Eagle Outfitters Inc. (NYSE:AEO)

Fwd. P/E: 6.9

Dividend Yield: 3.9%

Number of Hedge Fund Holders: 33

American Eagle Outfitters Inc. (NYSE:AEO) is a specialty retailer offering casual apparel, accessories, and personal care products, primarily catering to young consumers through its American Eagle and Aerie brands. The company operates its own stores, ships to approximately 80 countries via its websites, and licenses its merchandise in international markets.

On January 13, American Eagle Outfitters Inc. (NYSE:AEO) announced that comparable sales for the fourth quarter-to-date (as of January 4) had grown in the low single digits, surpassing its earlier guidance of a 1% increase. Both the American Eagle and Aerie brands saw continued sales momentum. As a result, the company raised its fourth-quarter outlook, now projecting an operating profit of approximately $135 million, an improvement from its prior estimate of $125 million to $130 million. This revision reflects a 2% increase in comparable sales, building on the 8% growth achieved in the previous year. However, despite the positive outlook adjustment, the company had previously indicated that total revenue is expected to decline by approximately 5% due to an unfavorable retail calendar impact. In total, the company has returned $231 million to shareholders year-to-date through a combination of dividends and share repurchases. It has a dividend yield of nearly 4%.

American Eagle Outfitters Inc. (NYSE:AEO) continues to strengthen its market position through its dual-brand strategy, capitalizing on the success of both American Eagle and Aerie. Its focus on digital expansion and omnichannel retailing has enhanced customer engagement and driven sales growth. Additionally, supply chain optimization and inventory management initiatives are contributing to improved margins and overall profitability.